The information
economy and greater connectedness have driven dramatic
changes to the way people work and live. New business
models have created a dramatic redistribution of power
and wealth. In addition to numerous corporate examples,
we see the same phenomenon in the realm of national
security where single individuals working in small,
distributed networks have disrupted the political,
economic, and military elements of power and established
dominance of nation states.
The nature of competition in the more closely connected
world is fundamentally different. Organizations must
now compete on learning, adaptation, speed of creation
of new knowledge, and the innovative application of
knowledge to drive value, all of which have major impacts
on strategy, organizational structure, and business
models. |
This article was published
in the Winter
2006 issue
of Perspectives.
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of Use policy regarding acceptable
use of content on the ICF International Web
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In an environment of accelerating change and unprecedented
uncertainty, leaders face an evolving competitive landscape
that challenges the traditional methods of strategy development,
planning, and practice yet provides unprecedented opportunity.
The concept of the adaptive enterprise holds tremendous promise
to drive organizations to new levels of competitive fitness.
Senior leaders and managers facing unpredictable and discontinuous
change need knowledge, methods, and tools to transform their
organizations into adaptive enterprises with minimal disruption
to current operations.
 How organizations of all types structure
themselves and operate will determine the winners and losers
in this emerging environment. An adaptive enterprise design
calls for a capabilities-based approach (managing networked
capabilities in real-time versus sequential and fragmented
functions) to managing assets, both physical and informational,
to sense and anticipate customer needs and respond rapidly
and effectively to add value to the customer's customer.
The Required Competencies of the Adaptive Enterprise
Haeckel
in Adaptive Enterprise: Creating and
Leading Sense-And-Respond Organizations1 outlines
five core competencies or capabilities that adaptive enterprises
adopting a sense-and-respond model must develop and excel
at:
(1) knowing earlier
(2) managing-by-wire
(3) designing
a business as a system
(4) dispatching capabilities
from the customer request back
(5) context-giving
leadership
Another point that we have observed that was not emphasized
by Haeckel is the impact of increased complexity. Increased
complexity has implications for the manner in which organizations
are governed. Accelerated progress in developing new ways
of operating closer to the customer is often incompatible
with traditional organizations constrained by multiple
layers of monolithic organizational structures and linear
processes.
An adaptive organization is one that is structured
for action. It is characterized by modular, reconfigurable
capabilities, adaptive management systems, and robust operating
designs that can survive independent of differences in
specific external threats, technologies, geographical areas,
and organizational boundaries. To produce value for clients,
it is imperative to manage information across the organization
to enable smart and rapid decision-making critical to the
coherent and precise application of resources.
There is
sufficient insight from research, evolving global business
models, and government efforts like the U.S. Department
of Defense's transformation experience, to consider the adaptive
enterprise model. This model and its associated practitioner-level
tools and methods, provide the leaders and managers of
today's modern organizations with a totally different approach
to sensing the environment, anticipating demands, and continually
developing and applying knowledge to produce innovative
solutions and services.
Organizations must now evolve new
management models and practices and the associated systems
and infrastructure to successfully adapt to the global
environment's competitive challenges. This will take a new
breed of risk-takers and bold leaders who will brave the
uncharted seas of disruptive and discontinuous change. Failure
to lead and implement systematic organizational transformations
will become a recipe for extinction.
Learn more about ICF International's capabilities in sense and respond logistics and
organizational
development and transformation.
Participate in ICF International's blog for the Center for Co-Evolutionary Development.
1Haeckel, Stephan H. Adaptive
Enterprise: Creating and Leading Sense-And-Respond Organizations. Boston, MA:
President and Fellows of Harvard College, 1999.
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